The Community Infrastructure Levy is a new levy that local authorities in England and Wales can choose to charge on new developments in their area.
The Government's Guide to The Community Infrastructure Levy.
The levy is designed to be fairer, faster and more transparent than the previous system of agreeing planning obligations between local councils and developers under section 106 of the Town and Country Planning Act 1990.
In areas where a community infrastructure levy is in force, land owners and developers must pay the levy to the local principal (county, district, and or borough) council.
The charges are set by the local principal councils, based on the size and type of the new development.
The money raised from the community infrastructure levy can be used to support development by funding infrastructure that the council, local community and neighbourhoods want, like new or safer road schemes, park improvements or a new health centre.
The community infrastructure levy according to the Government:
Gives local principal authorities the freedom to set their own priorities for what the money should be spent on
Gives local principal authorities a predictable funding stream that allows them to plan ahead more effectively
Gives developers much more certainty from the start about how much money they will be expected to contribute
Makes the system more transparent for local people, as local authorities have to report what they have spent the levy on each year
Rewards local (parish or town) council receiving new development through the direct allocation of a proportion (15% or 25% depending on whether a Neighbourhood Plan is in place) of levy funds collected in their area
But what is the problem with the scheme?
Town and parish councils have been passed just one per cent of Community Infrastructure Levy (CIL) receipts from developments in their area since neighbourhood funding rules came into force, despite being promised up to 25 per cent by ministers, according to Planning Magazine.